Dr. Penny Pincher founded the popular personal finance blog Penny Pincher Journal in 2013 and has published two books about saving money.
Store Closing Sales: How to Find Bargains
A while ago, a Sears store in my area closed. It was shocking to see the "Going Out of Business" signs posted—this Sears store was located in one of the most affluent areas in my state. Over the years I bought quite a few appliances and even a lawn mower at that Sears store.
The Sears store was facing competition in clothing sales from newer stores nearby such as Kohls, TJ Maxx, Gordmans, Von Maur, and Old Navy. The Lowes store across the street was competing with Sears on lawnmowers, tools, and appliances. The Menards across town was also competing in appliances. Several other stores in the same shopping mall as Sears competed selling small appliances like coffee makers and kitchen items. The Best Buy in the mall competed with Sears on selling televisions, stereos, and other consumer electronics. On-line competition in many of these areas also may have played a role in the demise of my Sears store.
Since the Sears store closing, two Kmart stores have closed in my area as well. I had a great shopping experience at one of the Kmart stores that is closing. I found 4 pairs of Wrangler jeans for $8 each, and a pair of Levis for $13. This was over 5 years ago, and I am still wearing all of these jeans and have only bought one other pair of jeans since then.
Overall, I am not really surprised to see Kmart stores close—my impression is that these stores are outdated, have poor quality merchandise, and employees that are not very interested in customer service. Almost any other store provides a better shopping experience than Kmart. Kmart faces strong competition from many sources, Walmart in particular. Dollar stores have also gained in popularity and directly compete with K-Mart.
Rumors are swirling about JCPenny stores. The financial health of this chain of stores seems to be in decline and it could be one of the big chains to start closing stores soon if conditions do not improve.
How to Find Store Closing and Going Out of Business Sales
It usually makes the news when a big store is going out of business. There were news stories about the Sears and Kmart store closing on local TV news and in the newspapers. Signs are another easy way to spot a store closing event. However this is effective only if you happen to pass by the store that is closing.
If you want to search for stores closing in your area, you can search for using Google. Search for "Store Closing" and add your city name to the search. If you want only recent news, you can use advanced search features in Google by clicking "Search Tools" and limiting search results to Past Month to get fresh store closing information.
The screen capture above shows an example of how to search for store closing sales in your town. Click on the "Search Tools" button and you can limit the search results to the past week or month to find sales that are going on now in your area.
When to Buy at Store Closing Sales?
When a store is going out of business, they want to get rid of both merchandise and store fixtures. Stores will gradually increase the discounts to sell off their inventory and get the maximum profit. If you see something you want, you can probably get a better discount if you wait- if the item is still available.
At the Sears store closing, I watched the bike seats start with a 10% discount, then 25% off, etc. It was down to 50% off after a few weeks and there were only a couple left. My wife was with me at the Sears store and saw me checking out the bike seat. "Why don't you get it?" she asked. I said that I thought it would get marked down more. My wife picked it up and bought it for me as a Christmas gift!
The right time to buy at a store closing sale comes down to a trade-off. The longer you wait, the bigger the discount. But your item may be gone if you wait too long.
Near the end of the store closing sale, the focus will move to selling store fixtures such as shelving, display cases, and clothing racks. If you have a retail store, or have a use for such items, they can be purchased for pennies on the dollar. A store that is closing has no interest in moving and storing used store fixtures- they would much rather get rid of them and get a little cash for these bulky items. You might be able to get some shelves or tables cheap that you can use for bookshelves or use in your shop.
If you are interesting in buying a lot of merchandise, you can make an offer to the store manager at any time. Once, I watched an entrepreneur offer to buy all of the remaining inventory of licensed athletic jackets and sweat shirts for what must have amounted to a hundreds of dollars. The merchandise was already marked down significantly, but the buyer was getting an even bigger discount for purchasing the rest of the available merchandise. He said he was planning to sell the items at tailgating events at football games in the fall for a big profit.
What to Buy at Going Out of Business Sales
The first thing to consider buying at a going out of business sale are items you were planning to buy anyway. The selection may be limited, and stores often have a no returns policy at going out of business sales. However, if you can live with these limitations, you might be able to find some good deals.
Store closing sales may be a good opportunity to purchase large quantities of items you use anyway at a big discount. Look for items that can be stored for a long time if you are planning to buy large quantities.
Here are my favorite things to look for at store closing sales:
- Tools: Stock up your workbench at significant discounts
- Clothes: Pick up items that wear out like belts and socks on sale
- Food: Get some nonperishable items that can be stored and used over time
- Sporting goods: These items get marked way down if you can wait
- Consumables: Soap, razor blades, paper towels, toilet paper
Reselling Items From a Store Closing Sale
If you have some dry space to store things and are willing to take a risk and put in some work, you could buy items to resell on craigslist or eBay. You would need to get a big enough discount to make this work out- likely more than 60% off retail price. For example, if I could get items 75% off, especially name brand items, it may be profitable to buy a bunch of items and try to sell them for a profit. However, it is worth checking out the prices for these items on places like amazon.com and ebay to make sure you could actually sell at a profit considering listing fees and shipping.
Some of the things that were marked down at the Kmart store closing would not have been profitable to resell. I looked at some bike headlight/taillight kits that were 50% off, but I found similar items available online selling for less than the 50% off going-out-of-business sale price—perhaps a big reason why so many stores seem to be having Going Out of Business Sales. . .
© 2013 Dr Penny Pincher
Dr Penny Pincher (author) from Iowa, USA on November 08, 2013:
It's hard to know how long to wait to get the best deal. You just need to decide when the deal is good enough and then go for it. I like Target quite a bit. Here in Iowa, Target has good prices and clean stores with helpful staff. Thanks for your comment!
kidscrafts from Ottawa, Canada on November 08, 2013:
I agree with you that buying items when a store is closing is a great way to get great bargain but like the story of your bicycle, if you had waited longer I think someone else would have bought your bike!
The "Zellers" stores in Ottawa who closed down earlier this year to be replace by "Target" stores and first the bargain were not very big but slowly they grew but the choice was not great anymore. I think to gain in that waiting game, you need a lot of time to get the best deal!
Thanks for sharing and enjoy your weekend!